04:33 PM EDT, 08/09/2024 (MT Newswires) -- US equity indexes closed lower this week as the sharp sell-off on Monday managed to outweigh gains from relatively strong economic data and helpful comments from Bank of Japan (BOJ) Deputy Governor Shinichi Uchida relating to the yen carry trade.

* The Dow Jones Industrial Average ended at 39,497.54 on Friday, down from 39,737.26 a week ago. The Nasdaq Composite closed at 16,745.30 versus 16,776.16 a week prior. The S&P 500 closed at 5,344.16, compared with 5,346.56 a week earlier. Energy, technology, and financials led the sector charts this week.

* Intraday Monday, the Nasdaq was down more than 1,000, and the CBOE's Volatility Index (VIX), known as the fear gauge, was surging 80% as pricing of interest-rate cuts in September and beyond fanned concerns a recession is lurking. According to the FedWatch Tool, the probability of a 50 basis point cut in rates stood at 86% by Monday afternoon, up from 74% a day earlier and 11% a week prior. The market also priced the possibility of a 100 basis-point cut next month, reflecting the panic.

* However, in the days ahead, macroeconomic data failed to confirm the recession narrative. US initial jobless claims fell 17,000 to 233,000 in the week ended Aug. 3 from an upwardly revised 250,000 in the previous week, compared with expectations for a smaller decrease to 240,000 in a survey of analysts compiled by Bloomberg.

* Meanwhile, Bank of Japan (BOJ) Deputy Governor Shinichi Uchida's comments Wednesday that the central bank would not raise rates amid financial market instability pushed the yen lower and helped improve market sentiment, a report from Reuters said. The BoJ's surprise rate hike on July 31 reportedly contributed to the global market crash Monday as the decision kicked off an unwinding of the so-called yen carry trade.

* Treasury yields recovered from the plunge on Monday, with the 10- and two-year yields set to end higher compared with Friday last week.